AudioHQ, a digital audio ad-repping company, entered the market today with an announcement of a launch partnership with 8tracks, the crowdsourced uploading and listening platform.
AudioHQ started in May of this year, and RAIN spoke with CEO Matt Cutair about his company, the digital audio advertising marketplace, and the 8tracks alliance. He outlined how AudioHQ is angling into the market.
“We see a bifurcated marketplace,” Cutair told us. “At the top end you’ve got the Pandoras and Spotify’s, with scale, advanced targeting, limited inventory, and direct sales forces. At the other end, you have pretty much everybody else. We see it as the ‘tonnage and efficiency’ market. Thousands of individual streams are put together into one giant network and sold that way, with no targeting of streams broken out — it’s one size fits all. It gives advertisers scale and reach for one efficient price, but also creates confusion at the agency level. How do they know exactly what they’re buying, or explain it to their clients?”
Matt Cutair noted that in these large and undifferentiated ad-buying markets, there is a race to the bottom as advertisers seek lowest prices in the absence of information that would warrent more careful buying. In this milieu, AudioHQ seeks what Matt Cutair calls a “middle market.”
“There are bigger brands and services that deserve to be sold in a more granular and targeted way. They deserve to be presented to advertisers as premium offering. They can be bundled in aggregate to achiece scale, but with transparency so agencies can understand what they’re buying. We are creating specialized network offerings focused on the premium space, not the long-tail space.”
That’s where 8tracks fits in. AudioHQ hopes to drive CPMs higher then they are in the mass buying market, while communicating to advertisers why the offering justifies the more premium approach.
“8tracks fits perfectly into the category of publishers we can help. They have scale — millions of users. They don’t necessarily want to, nor could they, perhaps, go directly to major radio agencies and try to attract sales on their own. 8tracks also has high engagement from a premium, targeted audience — millennial users of the 18-34 demographic, in comScore they over-index there compared to Pandora.”
8tracks currently claims 8-million monthly listeners, and has been profitable since mid-2012. David Porter, CEO, noted this: “As listening shifts away from the desktop, a relevant, well-crafted audio product is the natural step in the progression of our business model. We look forward to taking that step with Matt and his experienced team.”
(Article originally published on September 15, 2014 on RAINN News. Written by Brad Hill.)